You have a vision for your family business that goes beyond your immediate interaction with it. You want to leave it to your children. You hope that they can in turn leave it to your grandchildren. You want to create a legacy that spans the generations and provides income and opportunities for decades to come.
It may happen, but you need to know that the odds are against you. About two out of every three family businesses do not make it down to the next generation. The odds worsen with each successive generation, as only a third of those surviving companies successfully pass to the grandchildren. In the end, it means that just 10% of family businesses make it through three generations. Nine out of 10 fail.
This isn’t to frighten you or show you why you should give up on your dream. You absolutely should not. But it illustrates how you also can’t afford to take that dream for granted. Don’t just assume that everything is going to come together. You must take a very active approach to make the dream happen. It’s the only way you will have any chance to beat those odds.
How can you do it? One key step is to really consider what your business succession plan should look like and what goals it should include. When do you want to draft it? What can you do today to protect your company in 10 years? What pitfalls do you want to avoid? These are all important questions. Make sure you know what steps to take.